Correlation Between K One and Kossan Rubber
Can any of the company-specific risk be diversified away by investing in both K One and Kossan Rubber at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining K One and Kossan Rubber into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between K One Technology Bhd and Kossan Rubber Industries, you can compare the effects of market volatilities on K One and Kossan Rubber and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in K One with a short position of Kossan Rubber. Check out your portfolio center. Please also check ongoing floating volatility patterns of K One and Kossan Rubber.
Diversification Opportunities for K One and Kossan Rubber
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 0111 and Kossan is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding K One Technology Bhd and Kossan Rubber Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kossan Rubber Industries and K One is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on K One Technology Bhd are associated (or correlated) with Kossan Rubber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kossan Rubber Industries has no effect on the direction of K One i.e., K One and Kossan Rubber go up and down completely randomly.
Pair Corralation between K One and Kossan Rubber
Assuming the 90 days trading horizon K One is expected to generate 6.97 times less return on investment than Kossan Rubber. In addition to that, K One is 2.1 times more volatile than Kossan Rubber Industries. It trades about 0.02 of its total potential returns per unit of risk. Kossan Rubber Industries is currently generating about 0.32 per unit of volatility. If you would invest 215.00 in Kossan Rubber Industries on September 3, 2024 and sell it today you would earn a total of 33.00 from holding Kossan Rubber Industries or generate 15.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
K One Technology Bhd vs. Kossan Rubber Industries
Performance |
| Timeline |
| K One Technology |
| Kossan Rubber Industries |
K One and Kossan Rubber Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with K One and Kossan Rubber
The main advantage of trading using opposite K One and Kossan Rubber positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if K One position performs unexpectedly, Kossan Rubber can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Kossan Rubber will offset losses from the drop in Kossan Rubber's long position.| K One vs. Uchi Technologies Bhd | K One vs. Minetech Resources Bhd | K One vs. Swift Haulage Bhd | K One vs. Insas Bhd |
| Kossan Rubber vs. Minetech Resources Bhd | Kossan Rubber vs. Swift Haulage Bhd | Kossan Rubber vs. Insas Bhd | Kossan Rubber vs. Bina Darulaman Bhd |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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